Feed-in Tariffs: Meaning, Benefits, How it Works?


 If you’re interested in renewable energy, you’ve probably heard the term “feed-in tariff” before. But what exactly are feed-in tariffs, and how do they work? In this comprehensive guide, we’ll take a closer look at feed-in tariffs and provide you with everything you need to know to understand them better.

Feed-in tariffs are a government-backed scheme that rewards people who generate their electricity using renewable energy sources. The scheme pays people for every unit of energy they generate and feed into the grid, regardless of whether they use that energy themselves or sell it back to the grid.

In this blog, we’ll explore everything you need to know about feed-in tariffs, including how they work, the benefits and drawbacks of using them, and how to determine if they are right for you.

What are Feed-in Tariffs?

Feed-in tariffs are a government-backed scheme that incentivizes the generation of renewable energy by paying those who produce it for every unit of electricity generated. The scheme is designed to encourage homeowners, businesses, and communities to invest in renewable energy sources, such as solar panels, by providing them with financial support for the energy they produce.

How Do Feed-in Tariffs Work?

Feed-in tariffs work by paying those who generate renewable energy for every unit of electricity they produce, regardless of whether they use it themselves or sell it back to the grid. The payments are made by the energy supplier, who is required to buy the electricity generated by the renewable energy source at a premium rate, usually higher than the price paid for conventional energy.

The payments are made for both the electricity generated and the electricity exported back to the grid. The amount paid per unit of electricity generated depends on the type of renewable energy source and the size of the installation, but the payments are guaranteed for a set period, usually between 20 and 25 years, making them an attractive investment for homeowners, businesses, and communities.

Read More: Feed-in Tariffs: Meaning, Benefits, How it Works?

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